Trump's slash-and-burn budget could hit his own political base the hardest

Supporters at a rally for Republican presidential nominee Donald Trump in Tampa, Florida, in October.
Thomson Reuters
Donald Trump's proposed budget fits a familiar pattern for the president: When backed into a corner, go for the jugular.

This time, the victims would be federal government programs aimed at some of the neediest Americans, many of whom voted for Trump last year in the hopes that he might improve their lot.

Trump's plans are in keeping with his promise to make the government smaller, with one very large caveat that would be paid for with those essential-services cuts: a $54 billion increase in defense spending.

His priorities also say a lot about the likely composition of any future budget expenditures — including proposed fiscal stimulus and infrastructure programs that have been much discussed but on which few details are available.

What sorts of massively wasteful government functions would Trump cut? Try a 30% wallop to funding for the State Department, which his own secretary of defense, James Mattis, has said is crucial to American national security by helping to project the sort of diplomatic power that prevents conflict in the first place.

Trump's support among members of the military and veterans should have him looking to avoid wars, not start new ones. Instead, the president's hawkish tone is derided by the same former military officers Trump has placed in positions of power in his Cabinet.

What about his support among poor white voters? They stand to lose big from massive cuts to anti-poverty programs, without counting the strong likelihood that "Trumpcare" would deprive millions of healthcare.

"It stands beyond reason that a president who claimed to be concerned with working Americans, expanding the American economy, and keeping Americans healthy would author a budget that makes sweeping cuts to all these critical areas," House Democratic Caucus Chairman Joe Crowley said in a statement. The proposal "amounts to an assault on working families and the poor," he added.

Sharp cuts to environmental programs, seen as a progressive cause, may actually hurt many Republican-dominated states the most. By gutting funding for the Environmental Protection Agency, which would lose 3,000 workers, Trump would be leaving states with weak environmental agencies most vulnerable.

"Look to have a lot more situations like the one in West Virginia a few years ago where people didn't have clean drinking water or even water suitable for bathing because a local mining operation had dumped waste in the river that was their water source," said Dean Baker, codirector of the Center for Economic and Policy Research in Washington.

But even if Trump's budget, like his healthcare bill, stands little chance of becoming law in its current form, Wall Street should be playing closer attention to what the president's priorities say about the chances of a future spending boom of that sort that underpins stronger economic growth and productivity. After all, economists on both sides of the political divide agree that stimulus policies aimed at the neediest segments of society are more effective, because the money gets spent right away and the positive momentum feeds on itself. Tax cuts for the rich or giveaways to big corporations, on the other hand, tend to get stashed away in an uncertain economic environment.

Trump's budget breaks another key vow of the campaign — that Mexico would pay for the construction of a wall along the US-Mexico border. Instead, it turns out, American taxpayers will be footing the multibillion-dollar tab.